Single Gulf stock exchange needed to rival global players

Merger of Gulf bourses would ‘create real liquidity’ in the market, says Qatar bank chief
Single Gulf stock exchange needed to rival global players
Rivalry between Gulf exchanges is impeding the development of a single, strong Gulf market to compete with the likes of London
By Gavin Davids
Sun 02 Jan 2011 01:20 PM

The Gulf must create a
common stock exchange if it is to attract capital, drive economic integration
and rival bourses in major financial centres, the managing director of
International Bank of Qatar (IBQ) has said.

With as many as seven stock
exchanges in the GCC alone, the region is too fragmented to compete
internationally, said George Nasra.

“I wish we’d develop one
regional stock exchange to create real liquidity in it, because the way they
are now, they’re fragmented. They don’t have enough liquidity individually,” he
told Arabian Business.

Instead, the rivalry between the
exchanges is impeding the development of a single, strong Gulf market to
compete with the likes of London, he said.

At present, there are
approximately 1,314 listed companies across all seven competing GCC bourses. By
comparison; the New York Stock Exchange alone has 2,304 companies listed on its
index.

It was reported last month
that Abu Dhabi was in talks to buy out Dubai’s 20 percent stake in the London
Stock Exchange as part of a wider buyout of Dubai’s financial assets.

The proposed deal would see
the Abu Dhabi Securities Exchange merge with the Dubai International Financial
Centre and Borse Dubai, potentially creating a single entity more attractive to
investors.

Doha-based IBQ is in the final stages of negotiations for a merger with Al Khaliji Bank, the Gulf state’s sixth largest bank by market value. The merger is slated for completion in the first half of 2011.

 

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